You get the keys. You move in. But you don’t own it yet — and you’re paying a fee that builds no equity. Welcome to interim occupancy, the phase nobody explains before you sign. I’m Jatin Dua, RE/MAX Quantum Realty.
What interim occupancy actually is
When your pre-construction condo is finished enough to live in but the building hasn’t been legally registered as a condominium corporation yet, you move in during “interim occupancy.” Your mortgage hasn’t started, you don’t hold title, and you pay the builder a monthly occupancy fee until final closing.
What the occupancy fee covers
Three components: estimated interest on the unpaid balance of the purchase price, estimated monthly property taxes, and estimated common expenses (maintenance fees). None of it pays down your mortgage — this is the “phantom rent” people complain about, and it’s the single most misunderstood cost in pre-construction.
How long it lasts
Anywhere from a couple of months to well over a year, depending on how quickly registration completes — lower floors typically occupy first and wait longest. This is why I project occupancy costs for every pre-construction client before they sign.
How to protect yourself
Have your lawyer review the agreement during the 10-day cooling-off period: cap development charges, understand assignment and leasing rights during occupancy (many builders restrict renting your unit out in this window), and get the builder’s occupancy fee formula in writing. See my pre-construction vs resale comparison.
Is it a dealbreaker?
No — it’s a cost to plan for, not a reason to avoid new construction. Buyers who budget for it do fine; buyers who are surprised by it get stressed. Explore current projects on my Pre-Construction Hub.
FAQ — Interim Occupancy
What is interim occupancy in Ontario?
The period between moving into a new condo and the building’s legal registration, during which you pay the builder a monthly occupancy fee instead of a mortgage.
How much are occupancy fees?
They vary by unit price and size, comprising estimated interest, taxes and maintenance. Ask the builder for the formula and get a projection before signing.
Does the occupancy fee go toward my purchase?
No. It does not reduce your purchase price or build equity — one reason to understand the expected duration up front.
Can I rent out my unit during interim occupancy?
Sometimes, with builder consent and often a fee — many agreements restrict it. Have your lawyer confirm before you count on rental income. I review these clauses with every client.
About Jatin Dua — Your Etobicoke Real Estate Agent
Jatin Dua is a Realtor with RE/MAX Quantum Realty who focuses on Etobicoke — The Queensway, Humber Bay Shores, Mimico, Islington–City Centre and the Kingsway. If you’re searching for a top agent in Etobicoke who knows these streets building by building, book a free consultation, explore the Etobicoke community guide, or see every new project on my Pre-Construction Hub.